April 11, 2011

Mexican corn buyers consider US corn opportunities

Grain buyers from Mexico are interested in Nebraskan and Kansas white corn production and contracting opportunities, after frost damaged part of Mexico's white corn crop earlier this year.

A group of Mexican grain buyers will be in Nebraska and Kansas City next week to explore such opportunities, organised and supported by the US Grains Council, Nebraska Corn Board and Kansas Corn Commission.

"A significant portion of Mexico's winter white corn crop was damaged, which has tortilla manufacturers concerned," said Julio Hernandez, USGC director in Mexico. "The cost of replanting and a shortage of seed allowed only about half the acres to be replanted, and frost damage will likely impact overall yields."

Hernandez estimated that in the end, the country will be short about 2-2.5 million tonnes (78.7-98 million bushels) of white corn this year. "About 750,000 tonnes (29.5 million bushels) of white corn from the US has been sold to Mexico for delivery from June to October, but this will only make up part of the difference," he said.

Buyers from Mexico are interested in Nebraskan white corn, which has already been grown for several markets there. They are looking at options for longer-term solutions to white corn shortages in Mexico.

"About 75% of the 145,000 white corn acres planted in Nebraska are grown under contract, so it is essentially sold before it's even planted," said Kelly Brunkhorst, director of research for the Nebraska Corn Board. "While that limits what may be available for purchase this year, discussing the process and meeting with those who contract white corn may offer opportunities down the road."

Brunkhorst will travel with the group while they are in Nebraska, beginning Monday (Apr 11). They will spend time at two cooperatives and a private grain company, all of which supply white corn to buyers in different US markets by contracting white corn production with Nebraskan farmers.

"We are going to introduce buyers and sellers and talk about Nebraska corn production, the quality and reliability of that corn and find out how we can help them ensure consistent supplies in the future," Brunkhorst said. "If they are able to find some acres or bushels this year, all the better," he said.

The delegation will also travel to Kansas City to meet with additional suppliers. Later this fall, the Council, along with the Kentucky Corn Promotion Council, will follow up with the team.